Data shows that buzzy social app Friend.tech took a dive over the weekend, as many in the Web3 space predicted.
Social-fi app Friend.tech has been one of the exciting newcomers to the Web3 market throughout August.
Built on Coinbase’s L2, Base, the beta launch of Friend.tech was such a success that it pulled in $1.68m in daily fees on August 22, surpassing Bitcoin, Tron, Lido and Uniswap (DeFiLlama).
Over the weekend however, the app appears to have tanked, with key metrics pointing to a serious downturn.
On August 26, daily fees from Friend.tech came in at around $215,000, a decrease of approximately 86% from the all-time-high recorded earlier in the week. At the time of writing, fees have dropped even further down to $161,1117.
Friend.tech is a unique social app that lets users tokenise their likeness, or their X profiles, into ‘keys’. Those who buy these keys then gain access to a private Telegram-like channel, giving people direct access to their favourite accounts, personalities and influencers.
The app has been a huge hit with influencers, with crypto personalities like Cobie and HsakaTrades topping the revenue leaderboard. A CoinGecko report showed that Cobie earned the highest royalty earnings on the app as of August 22, bringing in $144,000 in Ether. HsakaTrades was a close second, bringing in over $100,000.
The app has particularly been a hit with OnlyFans creators who jumped over to the platform following an image-sharing update.
The influencer-led pump is now crashing, though. Numbers show that unique buyers and sellers have dived by 90% in one week, as per data from Dune Analytics.
August 21 saw approximately 4000 active buyers, compared with 361 today.
Transactions are also down from around 39,000 on August 21 to 1500 on August 27, a drop of 96.15%.
Crypto Twitter is now pronouncing the app ‘dead’
Many were sceptical of Friend.tech when it first launched – primarily due to the lack of transparency surrounding the team. Little is known about the people behind the project, other than that the founder identifies as ‘Racer’.
Coinbase Risk Manager Lisandro Rodriguez wrote on X that the idea behind Friend.tech is “really cool” in the sense that it gives people access to their favourite influencers, but the structure of the platform was/is flawed.
“Unless you were really really early,” he wrote, “access is still restricted to the elite because of how quickly prices rose for popular creators. It’s a great example of the rich getting richer and the poor getting poorer.”
“While I do think the idea of friends tech was cool, the greed and poor execution led to it’s demise,” he concluded.
Others in the crypto community however believe that the project simply ‘needs more time’, and that the exponential growth witnessed early last week isn’t something that can be sustained.
The dive will be a big ‘I told you so’ moment for some, such as on-chain analyst YazanXBT.
On August 20, Yazan tweeted that “something isn’t right” about Friend.tech. He pointed out that creators are making money from a group chat that “doesn’t even work”.
“I made $150 for doing literally nothing from less than 10 people,” he said, adding, “You can imagine what creators are doing with it.”
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